4 Sep, 2011  |  Written by  |  under News

HARTFORD, Conn. – For incoming freshmen at western Connecticut's suburban Brookfield High School, hefting a backpack weighed down with textbooks is about to give way to tapping out notes and flipping electronic pages on a glossy iPad tablet computer.

A few hours away, every student at Burlington High School near Boston will also start the year with new school-issued iPads, each loaded with electronic textbooks and other online resources in place of traditional bulky texts.

While iPads have rocketed to popularity on many college campuses since Apple Inc. introduced the device in spring 2010, many public secondary schools this fall will move away from textbooks in favor of the lightweight tablet computers.

Apple officials say they know of more than 600 districts that have launched what are called "one-to-one" programs, in which at least one classroom of students is getting iPads for each student to use throughout the school day.

Nearly two-thirds of them have begun since July, according to Apple.

New programs are being announced on a regular basis, too. As recently as Wednesday, Kentucky's education commissioner and the superintendent of schools in Woodford County, Ky., said that Woodford County High will become the state's first public high school to give each of its 1,250 students an iPad.

At Burlington High in suburban Boston, principal Patrick Larkin calls the $500 iPads a better long-term investment than textbooks, though he said the school will still use traditional texts in some courses if suitable electronic programs aren't yet available.

"I don't want to generalize because I don't want to insult people who are working hard to make those resources," Larkin said of textbooks, "but they're pretty much outdated the minute they're printed and certainly by the time they're delivered. The bottom line is that the iPads will give our kids a chance to use much more relevant materials."

The trend has not been limited to wealthy suburban districts. New York City, Chicago and many other urban districts also are buying large numbers of iPads.

The iPads generally cost districts between $500 and $600, depending on what accessories and service plans are purchased.

By comparison, Brookfield High in Connecticut estimates it spends at least that much yearly on every student's textbooks, not including graphing calculators, dictionaries and other accessories they can get on the iPads.

Educators say the sleek, flat tablet computers offer a variety of benefits.

They include interactive programs to demonstrate problem-solving in math, scratchpad features for note-taking and bookmarking, the ability to immediately send quizzes and homework to teachers, and the chance to view videos or tutorials on everything from important historical events to learning foreign languages.

They're especially popular in special education services, for children with autism spectrum disorders and learning disabilities, and for those who learn best when something is explained with visual images, not just through talking.

Some advocates also say the interactive nature of learning on an iPad comes naturally to many of today's students, who've grown up with electronic devices as part of their everyday world.

But for all of the excitement surrounding the growth of iPads in public secondary schools, some experts watching the trend warn that the districts need to ensure they can support the wireless infrastructure, repairs and other costs that accompany a switch to such a tech-heavy approach.

And even with the most modern device in hand, students still need the basics of a solid curriculum and skilled teachers.

"There's a saying that the music is not in the piano and, in the same way, the learning is not in the device," said Mark Warschauer, an education and informatics professor at the University of California-Irvine whose specialties include research on the intersection of technology and education.

"I don't want to oversell these things or present the idea that these devices are miraculous, but they have some benefits and that's why so many people outside of schools are using them so much," he said.

One such iPad devotee is 15-year-old Christian Woods, who starts his sophomore year at Burlington, Mass., High School on a special student support team to help about 1,000 other teens adjust to their new tablets.

"I think people will like it. I really don't know anybody in high school that wouldn't want to get an iPad," he said. "We're always using technology at home, then when you're at school it's textbooks, so it's a good way to put all of that together."

Districts are varied in their policies on how they police students' use.

Many have filtering programs to keep students off websites that have not been pre-approved, and some require the students to turn in the iPads during vacation breaks and at the end of the school year. Others hold the reins a little more loosely.

"If we truly consider this a learning device, we don't want to take it away and say, `Leaning stops in the summertime.' " said Larkin, the Burlington principal.

And the nation's domestic textbook publishing industry, accounting for $5.5 billion in yearly sales to secondary schools, is taking notice of the trend with its own shift in a competitive race toward developing curriculum specifically for iPads.

At Boston-based Houghton Mifflin Harcourt, for instance, programmers scrambled to create an iPad-specific secondary school program starting almost as soon as Apple unveiled the tablet in spring 2010.

The publisher's HMH Fuse algebra program, which became available at the start of the 2010 school year, was among the first and is a top seller to districts. Another algebra program and a geometry offering are coming out now.

The HMH Fuse online app is free and gives users an idea of how it works, and the content can be downloaded for $60. By comparison, the publisher's 950-page algebra text on which it was based is almost $73 per copy, and doesn't include the graphing calculators, interactive videos and other features.

For a school that would buy 300 of the textbooks for its freshman class, for instance, the savings from using the online version would be almost $4,000.

Jay Diskey, executive director of the Association of American Publishers' schools division, said all of the major textbook publishers are moving toward electronic offerings, but at least in the short term, traditional bound textbooks are here to stay.

"I think one of the real key questions that will be answered over the next several years is what sort of things work best in print for students and what sort of things work best digitally," Diskey said. "I think we're on the cusp of a whole new area of research and comprehension about what digital learning means."

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2 Sep, 2011  |  Written by  |  under News

SAN FRANCISCO – A federal judge on Thursday threw out a "grossly excessive" $1.3 billion verdict that Oracle won against SAP in a landmark intellectual property case, possibly setting the stage for another circus-like showdown between the two technology companies.

The decision was a surprising twist in a 4-year-old case that's been filled with them. There will be a new trial if Oracle Corp. formally rejects a lower $272 million award, which it has indicated it will do.

While Thursday's ruling was a victory for SAP AG, a German maker of business software, it's not necessarily as much of a setback for Oracle, which stands to humiliate SAP again even if it can't secure the higher award.

If the second trial is anything like last year's, expect more high-wire theatrics from Oracle's outspoken CEO, Larry Ellison, who has pilloried SAP for its amateurish theft of software and customer-support documents from password-protected Oracle websites. SAP has admitted that a now-shuttered subsidiary, TomorrowNow, committed the offense.

Oracle is the leading maker of database software, which helps companies organize their information. Its aggressive expansion into business applications has forced Oracle into a faceoff with SAP, the leader in that space.

Oracle argued that the stolen information helped SAP steal customers by offering similar services at cheaper prices. SAP argued that TomorrowNow wasn't that great at stealing customers with the information anyway and should have to pay only $40 million for accounts that SAP did manage to lure away.

The jury ultimately awarded Oracle more than 30 times that amount after a three-week trial last November. It was one of the largest verdicts in a case involving software-related theft and showed how severely jurors were willing to punish corporations for intellectual-property theft from rivals.

Although the amount was less than what Oracle asked for, it was far more than what SAP had budgeted. SAP had set aside $160 million to pay anticipated damages and had already spent $120 million of that in payments to Oracle's lawyers. The punishment amounted to more than half of SAP's total profit in the prior year.

Thursday's decision by Judge Phyllis Hamilton in in U.S. District Court in Oakland, Calif., is a major victory for SAP. She said the size of the penalty was "contrary to the weight of the evidence, and was grossly excessive."

Oracle can now choose whether to accept the lower award of $272 million or proceed with a new trial before a different jury. The $272 million amount was based on an earlier estimate from an Oracle expert on what profit Oracle lost and SAP gained.

Whatever happens, Oracle has already scored repeated public relations wins because of the case.

The case gave Ellison a platform to taunt another foe, former SAP CEO Leo Apotheker, who is now CEO of Hewlett-Packard Co. Oracle is increasingly battling HP in the market for computer servers, straining a decades-long technology partnership.

Oracle, which is based in Redwood Shores, Calif., tried to summon Apotheker to testify at the trial, and the company pushed the image of a "Where's Waldo?"-type manhunt involving private investigators and a vanished executive. Apotheker wasn't spotted within the jurisdiction of the Oakland court in time, and he didn't appear.

HP, based in Palo Alto, continually skirted questions about Apotheker's whereabouts at the time, presumably because there was little to be gained in allowing him to testify. HP accused Oracle of harassing its new executive and said Oracle had ample time to question Apotheker in an earlier deposition.

SAP said it was very gratified with Thursday's decision.

"We believed the jury's verdict was wrong and are pleased at the significant reduction in damages," the company said in a statement. "We hope the court's action will help drive this matter to a final resolution."

Oracle said it plans to fight for the full amount it was awarded.

"There was voluminous evidence regarding the massive scope of the theft, clear involvement of SAP management in the misconduct and the tremendous value of the (intellectual property) stolen," Oracle said. "We believe the jury got it right and we intend to pursue the full measure of damages that we believe are owed to Oracle."

Oracle's stock fell 23 cents, or 0.8 percent, to close Thursday at $27.84. SAP's stock fell 75 cents, or 1.4 percent, to $53.76.

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SAN FRANCISCO – The Justice Department's rejection of AT&T's proposed purchase of T-Mobile USA will test new federal guidelines on challenging mergers and the companies' resolve in forming the nation's largest wireless carrier.

A courtroom battle is likely and could wring out information that the companies would prefer to keep private. Still, AT&T Inc. has a big incentive to fight: If the deal is called off, the company has to pay a $3 billion breakup fee and surrender some of its unused spectrum for wireless communications.

AT&T is promising to fight the Justice Department's decision. The department filed a lawsuit Wednesday to block the $39 billion deal, saying it would reduce competition and lead to price increases for customers.

If AT&T follows through on that, it could produce the biggest antitrust showdown since business software maker Oracle Corp. squared off with the federal government seven years ago. That dispute, triggered by the government's decision to block Oracle's proposed purchase of rival PeopleSoft Inc., exposed several well-kept corporate secrets and required Oracle CEO Larry Ellison to testify before a packed courtroom.

In the end, Oracle pulled off something few companies have done in the past 30 years: It persuaded a federal judge that the Justice Department didn't have grounds to block its PeopleSoft deal. Oracle closed its $11.1 billion takeover four months after getting the favorable court ruling.

Usually, not even the most powerful companies bother to fight government regulators in an antitrust dispute. Google Inc., for example, backed off in 2008 when the Justice Department threatened to sue to block a proposed Internet search partnership with Yahoo Inc. Microsoft Corp., the world's largest software maker, pulled out of a deal to buy Intuit Corp. in 1995 after the Justice Department objected.

The Justice Department filed 138 antitrust cases in federal courts from 1999 to 2008 and lost just four of them, according to the latest breakdown from the agency.

One reason that the Justice Department has such a good track record is because it rarely challenges a deal unless it's very confident it can win, said Joseph Bauer, a University of Notre Dame law professor and antitrust expert.

Knowing AT&T would probably go to court, the Justice Department may have wanted to signal that it intends to get tougher on corporate marriages between rivals in markets with few other competitors.

A union between AT&T and T-Mobile USA would leave Verizon and Sprint as the only other major cellphone carriers in the U.S. T-Mobile, a subsidiary of German telecom company Deutsche Telekom AG, is currently the No. 4 wireless carrier, while AT&T is second. Combined, AT&T would be the largest.

In a sign of its confidence, the Justice Department decided to strike down the deal even though it could have taken about three more months to study the pros and cons. The timing stunned AT&T, which said it didn't get any advance warning.

"It was an aggressive and impressive move by the DOJ to take the battle right at AT&T," said Daniel Wall, a San Francisco attorney who represented Oracle in its 2004 fight to win the right to buy PeopleSoft. "It sent a statement that the DOJ intends to fight this one all the way to the finish line."

Wall said AT&T may have a tougher time proving its case than Oracle did against the Justice Department. In the PeopleSoft deal, Wall said, antitrust enforcers seemed to be manipulating the definition of the business software market. "This time, it looks to me that they have a pretty solid market definition," Wall said. "They don't appear to be playing games."

University of Iowa law professor Herbert Hovenkamp said the Justice Department is being guided by a set of new guidelines, issued late last year, which make it clearer when mergers should be challenged on antitrust grounds.

"I don't think they are overreaching here," Hovenkamp said. "If there is a broader message here, it's that the government intends to enforce these new guidelines."

Besides being forced to divulge potentially damaging information, AT&T will face other risks if it doesn't settle with the Justice Department. Going to trial will take months, or even years, leaving the company in a legal limbo that could depress its stock price and cause customers and key employees to defect.

There's another risk to going to trial: as they try to prove their case, antitrust lawyers sometimes obtain confidential e-mails that contain embarrassing snippets and present other evidence that can make companies look bad.

Those are some of the reasons why AT&T mayl try to reach some kind of settlement with the government.

If AT&T persists, antitrust experts said that it's better off going up against the Justice Department than the Federal Trade Commission, which also handles antitrust reviews. That's mainly because lawsuits with the Justice Department are contested in federal courts. By contrast, the threshold for the FTC to block deals is generally lower, and the ensuing legal skirmishes occur in administrative law proceedings that drag on longer.

"The merging parties usually have a better shot when they are going up against the DOJ than the FTC," said D. Daniel Sokol, a University of Florida professor specializing in antitrust law.

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27 Aug, 2011  |  Written by  |  under News

SAN FRANCISCO – Steve Jobs has been Apple's most recognizable personality, but much of its cachet comes from its clean, inviting designs. For that, Apple can credit its head designer, Jonathan Ive.

Ive, a self-effacing 44-year-old Brit, helped Jobs bring Apple back from the brink of financial ruin with the whimsical iMac computer, whose original models came in bright colors at a time when bland shades dominated the PC world. He later helped transform Apple into a consumer electronics powerhouse and the envy of Silicon Valley with the iPod, the iPhone and, most recently, the iPad.

In the wake of Jobs' resignation as CEO, Apple must show that it can keep churning out head-turning products even without its charismatic leader. Apple's chief operating officer, Tim Cook, is now CEO, taking on the role of Apple's public face.

But in many ways the real pressure will fall on Ive to make sure Apple continues its string of gadget successes.

Ive, known to his friends as "Jony," has led Apple's design team since the mid-'90s. Working closely with Jobs, Ive has built a strong legacy at Apple, ushering in products that are sleek and stylish, with rounded corners, few buttons, brushed aluminum surfaces and plenty of slick glass.

Apple's pride in this work is evident even in the packaging: Open up any iPhone box, for example, and see Apple proudly proclaim, "Designed by Apple in California." Six of Ive's works, including the original iPod, are even part of the collection at the Museum of Modern Art in New York.

People who have worked with Ive describe him as humble and sweet, quiet and shy, but also confident, hard-working and brilliant. Paola Antonelli, senior curator of architecture and design for MoMA, said she knows "hardly anybody that is so universally loved and admired" as Ive.

"Products have to be designed better now for people to buy them because of Jony Ive and Steve Jobs and Apple," Antonelli said. "All of a sudden people have gotten used to elegance and beauty, and there's no going back."

Design, as well as software that makes the gadgets easy to use, is a crucial part of setting Apple products apart from those of its rivals. Apple didn't make the first music player or smartphone, but it blew past rivals by making ones that looked cool and worked well.

Ive started out far from Apple Inc.'s Cupertino headquarters. He grew up outside London and studied design at Newcastle Polytechnic (now Northumbria University) in Newcastle, England. After finishing school, he co-founded a London-based design company called Tangerine. There, he designed a range of products including combs and power tools. It was through Tangerine that he first got to work with Apple.

In 1992, while Jobs was still in the midst of a 12-year exile from Apple, the company's design chief at the time, Robert Brunner, hired Ive as a senior designer. Thomas Meyerhoffer, who worked under Ive at Apple in the `90s, believes Ive came because he understood Apple was different from other computer companies.

"He came to Apple to take that even further," Meyerhoffer said.

And Ive did, but not right away. Ive quickly became a leader, working as the creative studio manager and helping to build Apple's design team during a period in which the company struggled to innovate.

Apple declined requests for an interview with Ive. But during a 1999 interview with The Associated Press, Ive said that for years, designers would produce foam models of computers only to be sent back to their drawing boards because of managers' fixations with focus groups and marketing figures.

"We lost our identity and looked to competition for leadership," Ive said at the time.

Brunner left in 1996 and suggested that Ive take over the post, even though Ive was only 29. When Jobs returned from his exile and became interim CEO in 1997, he named Ive as senior vice president of industrial design.

With Jobs again at the helm and Ive as his style guru, Apple refocused around design and produced a hit that got the company back on track. Apple shook up the personal computer industry in 1998 with the candy-colored all-in-one iMac desktop, the original models shaped like a futuristic TV.

Unlike previous product attempts, the iMac concept was immediately embraced by the top decision makers at Apple, and the design went through very few revisions.

"We knew we had it when we saw it, and with Jobs' support we were able to make it happen," Ive said in 1999.

At a time when most computers were boxy and largely black, beige or gray, the iMac was bulbous and flashy. People snapped up 150,000 of them in the first weekend following its release. Apple sold 800,000 iMacs by the end of the year.

The iMac changed the way consumers thought about personal computers and about Apple itself. It gave Apple a vital boost that helped it usher in a new era of consumer electronics that were quirky, fun and colorful. The marketing team even teased consumers by encouraging them at one point to collect all five — strawberry, blueberry, grape, tangerine and lime.

With Ive in charge of design, Apple then bought out the first iPod in 2001, the iPhone in 2007 and the iPad in 2010. In recent years, the company has largely dropped the bright color palette (though you can still find it on some iPods) in favor of black, white and silver hues. Yet they retained simplicity that made them approachable to everyone — from the tech geek to Grandma — as well as the curves, shiny surfaces and expensive appearance.

As a result, Apple's products are more popular than ever, allowing the company to surpass rival Microsoft Corp. last year as the most valuable technology company in the world.

"He wasn't responsible for them, but they definitely couldn't have done them without him," said Leander Kahney, who has written about Apple in several books and on his "Cult of Mac" blog.

Ive and Jobs have worked hand in hand and, in many respects, have contributed to each other's success. Ive has always been in contact with Jobs and speaks the same language as him, Antonelli said, and they clearly have chemistry.

Don Norman, who worked at Apple in the `90s as vice president of the company's advanced technology group, said that while Ive had good design ideas "sitting on the shelves," he needed Jobs to get those designs off the shelves.

"Jony has always been Jony — brilliant," Norman said. "What he needed was a Steve Jobs to say, `Make this happen.'"

Now, the test will be whether Cook can continue to keep that focus at Apple and encourage Ive to continue creating hits.

In a sense, the challenge won't be as difficult as it had been in the 1990s. Now that Apple has developed a style, it can build on it rather than try to reimagine it with each new product.

And that, Norman says, is now in Apple's DNA.

___

Online:

Ive collection at MoMA:

http://bit.ly/niZFGZ

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20 Aug, 2011  |  Written by  |  under News

SAN FRANCISCO – Hewlett-Packard, one of the world's largest technology companies, finds itself the underdog as it ditches most of its consumer businesses to become more like the well-oiled, corporate-focused machines of rivals IBM and Oracle.

HP will no longer make smartphones and tablet computers and wants to leave the PC business after spending a decade assembling itself into a technology conglomerate by buying such companies as computer maker Compaq Computer for $19 billion in 2002 and smartphone pioneer Palm for $1.8 billion last year.

HP's stock plunged 20 percent on Friday, a day after the restructuring announcement. That's a strong signal that investors are doubtful about HP's ability to thrive without businesses that have helped set it apart from rivals. Even though the PC division that HP wants to sell or spin off is the company's least profitable, it accounts for nearly a third of revenue.

Rumors have been circulating for months that HP might try to exit the PC business, which is under pressure from tablet computers and smartphones — the ones made by Apple, not HP. Analysts generally agree that HP would be better off in shedding a thinly profitable business that faces fierce competition.

However, their anxiety spiked because of how HP went about it. Some analysts worry that CEO Leo Apotheker may have done irreversible damage to the PC business by throwing its future into question. He said HP is merely considering possibilities for the business and may not shed it at all after 12 to 18 months of exploration.

That uncertainty could lead to an exodus of customers, which would lower the price that HP could fetch for the division if it's able to sell it. Or it could damage its value so much that HP isn't able to unload it and is stuck with a business in decline.

Even if HP does shed its PC unit, it's left with businesses that are already under pressure. In many cases, those businesses are playing catch-up to IBM, Oracle and Cisco Systems Inc., which is going through its own restructuring.

HP would be left with only one major business in which it is the clear leader — printers and printer ink, a longtime cash cow. It would also still sell servers, but it is running even with IBM in that area.

In other, more lucrative areas, HP is far behind. IBM is the market leader in technical services. Cisco is the leader in computer networking equipment. IBM, Oracle and Apotheker's former employer, SAP AG, rule in business software.

Losing the PC business would leave a giant hole. In the past nine months, for instance, it supplied nearly $30 billion of HP's revenue of $95 billion. And that doesn't include ancillary sales, such as selling a printer to a company that has already bought a PC. HP will likely lose some leverage in those relationships, and other divisions could suffer as a result.

Tablets and smartphones were a much smaller factor. HP doesn't break out that category and had included it in a catch-all category of corporate investments, which supplied just $416 million in revenue since the fiscal year started in November. But the businesses were clearly in trouble. That division lost nearly twice that amount during the same period.

Jayson Noland, an analyst with Robert W. Baird & Co., said the restructuring plan raises questions about HP's viability.

He has downgraded HP stock to "neutral," after HP's latest quarterly results showed falling profit margins in its services and printer and ink businesses. Those are HP's most profitable divisions and would take on an even more prominent role after the restructuring. Noland said HP no longer would be a "safe haven" when the economy is rough. The transformation plan, he said, is expensive, protracted and risky.

In announcing the sweeping changes, HP is trying to emulate IBM.

IBM rescued itself from the brink of collapse in the 1990s by ditching its consumer businesses and focusing on services and software. But following that model puts HP at a disadvantage, because IBM has had nearly a decade to perfect it.

IBM's head start confers many advantages, especially stronger investor support for the market leader. IBM enjoys a market value of about $190 billion as of Friday, nearly four times as large as HP's $50 billion.

And IBM has had years to invest in areas that HP is just now exploring.

More than 90 percent of IBM's income comes from services and software, areas in which it has spent billions of dollars on research and acquisitions. By contrast, just over 40 percent of HP's income is from those businesses. HP is still largely dependent on legacy businesses, particularly printer ink, PCs and servers.

Services became HP's most profitable division with its $14 billion acquisition of Electronic Data Systems in 2008. But that business has suffered, and Apotheker has blamed years of neglect by his predecessor, Mark Hurd, who resigned under pressure a year ago in a scandal over ties with a former contractor.

And IBM is far ahead here. Its revenue from services and software is twice as big as HP's.

IBM has been down this road before.

IBM's decision to sell its PC business in 2005 was one of the last steps of its transformation, but IBM's PC business was substantially smaller then than HP's. IBM had just 5 percent of the worldwide PC market at the time. By contrast, HP commands nearly 20 percent of the worldwide PC market today, making it the world's top computer maker. And its PC business makes money, unlike IBM's at the time.

The fact that HP's PC business is thinly profitable will limit how much HP can fetch for it. Brian White, an analyst with Ticonderoga Securities, warned investors that even if HP sold it for $12.5 billion, it would only add 6 cents per share to annual income.

"A possible PC divestiture won't cure the near-term challenges," he said.

Apotheker, in an interview with The Associated Press, was reluctant to discuss how IBM played into his decisions.

But he said that the differences between the companies' PC businesses would allow HP to extract a higher price. IBM, which is based in Armonk, N.Y., got $1.75 billion from Chinese computer maker Lenovo Group Ltd. for its PC operations.

"When IBM spun out their PC business, they spun out a money-losing business," Apotheker said. "We are very proud to have a money-making, market-leading business with the best margins in the business. We are going at this from a position of strength."

The transformation Apotheker envisions would strip HP of valuable levers that have set the company apart. The consumer businesses have helped insulate HP from swings in how businesses and governments buy information technology.

A downbeat report from PC maker Dell Inc. this week, and HP's cut to its full-year revenue guidance on Thursday, reinforced fears that companies and government agencies have dialed back their spending on technology.

To some analysts, the restructuring has a make-or-break quality.

Investor sentiment is likely to turn on the fate of the PC business. How it's handled could have ramifications for Apotheker's job security as well. He is in his 10th month on the job.

By announcing the deliberations "without a clear plan or buyer in place, the company effectively set the clock ticking on the profitable PC business's viability — and value," analysts from IDC wrote in a research note. In 18 months, that business "may be unrecognizable."

Shares of HP, which is based in Palo Alto, Calif., fell $5.91, or 20 percent, to close Friday at $23.60.

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